Pay-TV, Video-on-Demand outgrowing ad-funded TV in Germany

The Netflix logo is seen on their office in Hollywood, Los Angeles, California, U.S. July 16, 2018. REUTERS/Lucy Nicholson

FRANKFURT (Reuters) - Pay-TV and Paid Video-on-Demand are expected to rapidly outgrow advertising funded TV in Germany this year, an industry association said, as commercial broadcasters struggle to compete with rivals like Netflix.

Revenues from subscription TV and video are seen growing by 10.7 percent to 3.4 billion euros ($3.9 billion), the VAUNET alliance of privately owned media companies said on Wednesday.

By contrast, traditional TV advertising will grow by just 0.5 percent to 4.6 billion euros. At the same time, so-called ‘instream’ ads shown by online video platforms like Youtube are set to grow by 15 percent to 552 million euros.

Broadcasters like ProSiebenSat 1 and RTL Group are developing their own video streaming platforms, but these remain too small to shield them from a flat overall TV ad market in Europe’s largest economy.